What’s your CFOs preferred ERP strategy?

Aligning an ERP implementation with your company’s overall business strategy can be difficult as it requires many decisions to be made.

One of the critical decisions relates to ERP deployments, where one size does not fit all. There are many options to consider. Options range from a decentralized deployment where you allow your subsidiaries to choose their own solution, a two-tier ERP strategy where larger business units use a global ERP solution and smaller units deploy a standard solution, and the single global instance deployment where all business units use the same ERP instance. At Microsoft, we focus on enabling customers to choose the deployment model that best suits their business strategy.

So, what’s your CFO’s preference?

According to a Gartner report published in July 2012, “59 percent of senior financial executives in this study preferred a single, global ERP system for their enterprise”.* Gartner also finds that, “This is the approach that should be considered in the integrated organization where there is a high degree of dependence and commerce among units”.*

A single-instance strategy is compelling in that it helps lower cost in the many organizations that struggle with redundant data, high training costs and lack of insight across disparate systems and processes. Yet, single instance deployments - while driving operational efficiencies and process standardization - can bring challenges. Some are related to the desire of a business unit for more autonomy; others are of a more technical nature. Let’s take a look at 3 considerations when evaluating a single instance deployment:

  • Global organizations with legal entities operating in different countries need to comply with local statutory reporting and legal requirements. Trying to comply with these different requirements in one single code base can add system complexity, both in configuration and management as well as user experience.
  • Whenever many users access the same single instance it is critical that access to data and business processes are restricted in a way that can be easily monitored and managed.
  • Although there might be a high degree of commonality across entities, there still needs to be support for industry-specific requirements and specific processes and policies.

One of the key objectives for Microsoft Dynamics AX 2012 R2 is to further improve support of a single global instance ERP implementation when it is the preferred implementation option. Let’s take a look at how Microsoft Dynamics AX 2012 supports single instance deployments:

  • Additional support of localizations managed in a single instance
    Microsoft Dynamics AX 2012 (released in August 2011) already delivers regulatory support and localizations for 25 countries. With the release of Microsoft Dynamics AX 2012 R2 an additional 11 countries will be supported – enabling deployment for these new countries as well as all existing countries in one single instance. The countries for which localization and translation are planned include: Brazil, Czech Republic, China, Estonia, Hungary, India, Japan, Latvia, Lithuania, Poland, and Russia.
  • Minimization of user exposure to unnecessary complexity
    While all users have access to the same instance, country specific functionality is enabled based on the location of the legal entity. A user’s access to company specific capabilities can be restricted through security setup to help simplify the implementation and user experience.
  • Data management and security
    In Microsoft Dynamics AX 2012 data can be easily shared to avoid redundancy, and data security can be increased by using security policies and effective dates. In the upcoming release we added functionality to support scenarios when data sharing is not permitted or beneficial. Data partitions can be created to isolate and restrict access to data sets. This is a must have capability in a scenario where business units are autonomous and sharing data would add additional complexity or is even prohibited.

While Microsoft Dynamics AX 2012 supports multiple ERP deployment strategies, the focus in the upcoming release was to better enable a global single instance. There are many deployment options to consider, with Microsoft Dynamics AX you can choose the one that best fits your business strategy.

To learn more about the next release of Microsoft Dynamics AX 2012 R2, sign up for the Microsoft Dynamics AX 2012 Technical Conference 2012. For more information go to: http://www.microsoft.com/dynamics/DynamicsAXtechnicalconference

Yvonne Haarloev
Sr. Product Marketing Manager - Microsoft Dynamics ERP


*Source: CFOs Prioritize Business Applications: 2012 Gartner FEI Technology Study. Published: 17 July 2012 ID: G00234220